The U.S. real estate collapse continues
Financial analyst Al Martin gave a stark and timely presentation of the continuing economic collapse on his August 28, 2010 monthly appearance on Erskine Overnight.
First segment
- Existing home sales have fallen to levels not seen since the Korean war.
- Unsold inventories of existing homes, 12 1/2 months, is the highest on record, not even reached during the depths of the Great Depression in 1933.
- 44 of the last 48 months have been negative for mutual funds.
- $500 billion annual drawdown of common stock mutual funds.
- He said gold is the ultimate hedge. (In contrast, in November 2009, he effectively told gold shills to take a chill pill).
- He said gold has always risen in a deflationary environment.
Second segment
- In 2005, 26% of U.S. debt was financed internally — now 33%.
- $500,000 house in Stockton, California in 2005, has defaulted three times since then. It dropped to $400,000 in Q1 2007, $300,000 in Q2 2008, $200,000 in Q3 2009, now being sold by the bank for $185,000.
- He said historically, a bottom in the U.S. real estate market comes as the percentage of cash buyers increases. Now, 33% of all housing units sold are paid in full with cash. When it reaches 50%, he says the market will have reached a bottom.
- 25 to 30 year-old first time homebuyers have fallen 70% since 2005.
Third segment
- Defense Secretary Robert Gates announced 150,000 U.S. troops to be redeployed to the U.S. by 2014.
- He said there is record global inventory for oil and copper: a 2 million ton net surplus for copper at the end of the year, and copper is at least a dollar per pound overvalued, and oil is overvalued by at least $20 a barrel.
- They figured the world economy would perpetually grow by at least 2.2% per year, but 1% is now the new target.
Coincidentally I was listening to that show after having called in to Secret Truth twice and Amerika Now once. I was disappointed to find Erskine does not take calls. Yes crank up the printing presses. Interest free. Even National Propaganda Radio was talking about the concept last week. It was a good week for them with a story about the Kommunist Koch brothers controlling the platform of the Tea Party(after deciphering). The bankers are playing a delicate game. How long do they squeeze us before we figure out how to cut them out. What would they do? The only job that makes enough money for them to afford their lawn maintenance is banker.